One
of the major elements contributing to business failure is the lack of
entrepre-neurial qualities. So what are they? Do you fit the criteria?
Don't put your head in the sand on this issue. Starting a business is
tough and it is very important that you determine early on if you have
the "right stuff." Better you find out now what qualities you may need
to strengthen rather than finding out once it is too late.

John
and I were recently discussing the problems he was having with his new
business venture. After chatting for a while it was clear to me that
he should have never undertaken the venture-He simply did not have the
entrepreneurial 'spirit.' John didn't discuss his venture with me even
though he knew I was a business consultant. He knew that I would tell
him not to do it. You see, John KNEW he needed to strengthen certain
qualities, but was blinded by the dollar signs in his eyes!

You need
to be more honest with yourself than John, so let's take a little test.
This test is an entrepreneurial aptitude test, a sort of "self-evaluation"
checklist. A high score places you in the profile more likely to succeed
in starting and operating a business. Answer each question honestly!
We will then discuss each question. Grade each question on a scale of
0 to 5, with 5 being yes, absolutely, and 0 being no, absolutely.

CHECKLIST
#1:
ENTREPRENEURIAL APTITUDE

Are
you a leader?

Are
you a high-energy person?

Are
you self-confident?

Are
you organized?

Are
you competitive?

Are
you prepared to work long hours, every day for an indefinite period?

Do
you have adequate resources?

Are
you in good health?

Do
you have a unique service or product?

Is
your spouse on board with your ideas?

Are
you willing to make short-term sacrifices in return for long term
success?

Are
you a risk taker?

Are
you a good communicator?

Do
you have adequate experience?

Now total
your score ... Good news, there is no failing score! The list only serves
to provide an "awareness" of what you need to be thinking about. Now let's
look into each question with a bit more care. 1. Are you a leader?

It is
hard to "define" a leader, but it is easy to know one when you see one.
A good "manager," by the way, is not necessarily a leader. It has been
said that leading is doing the right thing and managing is doing things
right! An entrepreneur must, of course, be a competent manager, but,
more importantly, must lead the way to success.

A few
years ago while consulting for a relay manufacturing business I met
with the founder and owner. It was easy to see he was an excellent manager
and organizer. He had effectively set up his company, found satis-factory
help, and was quickly manufacturing small runs of high quality electromechanical
relays. When he called me, the company was in trouble - Poor sales,
decreasing order backlog, etc. We determined the problem was that the
market had been slowly moving towards solid-state relays and the electro-mechanical
units simply were no longer being designed into equipment. In overlooking
(or not being aware) of this fact, the owner, although a good manager,
was not LEADING the company in a successful direction.

TRUISM 1
It takes a leader to successfully start, run, and grow a business.

A group
of surveyors was lost in the jungle and had been wandering for a number
of hours under the hot sun. They were following instructions from
Harry, who was carefully organizing their route through the dense
jungle underbrush. He made sure they were not going in circles, assigned
one member of the party to keep the long knifes sharpened that they
carried to cut the brush, ensured rest breaks were periodically taken,
that water was being rationed, and so forth. Finally, Paul, nearly
exhausted and anxious to end this adventure, climbed a tall tree,
took a look, and yelled down to the group, "Hey, we're going the wrong
direction, there's a town about 200-yards off to the left!" Harry
was a good manager, but Paul is a leader!

To be
a good leader you must focus your energy. If you are going to start
a business, be prepared to focus on your objectives. If you feel you
lack leadership qualities, read one or more of the many good books available
on the subject. No one really knows if a leader is born or made, but
it is possible to focus on those qualities that most leaders seem to
possess. The reference section at the end of this chapter suggests some
reading material on this subject.

2. Are
you a "high energy" person?

Starting
and running a business requires con-siderable energy and the ability
to focus on your objectives. Long hours will be required which, if you
are already employed full time, quickly takes its toll. A high-energy
level is a must.

If you
know in your heart that you're a ball of fire, but just can't get off
the couch in the evenings, you might want to look into your diet and
exercise programs.

Note
at what times of day you are at your best. Some of us are "morning people"
and others are "night people." A morning person might not do well running
a business that requires late hours and conversely, a night person should
not consider an early morning delivery business!

3. Are
you self-confident?

You must
believe in what you are doing. Get involved in something you are GOOD
at doing. Familiarity and ability breed confidence. Don't make the mistake
of getting into a business because it looks like a good money maker
or it is the "business of choice" this year. If you know absolutely
nothing about the restaurant business, don't start a restaurant!

If your
business encompasses one or more of your hobbies or other long-term
interests and/or exper-tise, your self-confidence will be enhanced.
Your level of confidence is important …You must believe in what you
are doing and be confident of attaining your business goals.

4. Are
you organized?

You need
to be organized in order to make good use of your time. Rest assured,
you will never have all the time you think you need to accomplish what
you feel needs to be done, but organization allows you to use time in
the most effective manner. In other words, you will get more done in
less time. How organized are you?

Do
you get things done on time ... always?

Can
you always find what you're looking for?

Do
you keep a schedule? A "to-do" list?

Are
you on time for appointments?

If you "feel"
organized, you probably are. If you need some improvement, start by keeping
a detailed schedule of your activities. Refer to references at end of
this chapter for suggested information resources on this topic.

Time
saving tip: Use e-mail rather than the telephone --no more "telephone
tag."

5. Are
you competitive?

From
day one, you and your business will be in competition. A competitive
spirit is almost man-datory. Are you competitive? Do you strive to be
first or the best? Your hobbies and sporting interests can tell you
a lot about your competitive nature. You are your own best judge. Give
it some thought ... If you're a fighter, your chances for success are
improved.

6. Are
you prepared to work long hours?

During
a recent lecture I asked the participants why they were contemplating
starting their own business. One of the people in the audience responded
by saying she was tired of being required by her supervisor to frequently
work late. She wanted her own business so that she could have more free
time and work her own hours.

There's
an old joke that says an entrepreneur only works half time ... 12 hours
a day. The fact is, 12 hours a day might be a little light. Building
and operating your own business is considerably more time intensive
then working for someone else. You can set your own hours all right
... From about 6AM to midnight! The typical entrepreneur does, like
the old joke, work an average of 12 hours per day, six and sometimes
seven days a week. However, this hard work can bring rewards and a feeling
of accomplishment like nothing else can.

7. Do
you have adequate resources?

Have
you thought out what kind of monetary investment will be required? Do
you have it? Can you borrow it? Lack of adequate resources is one of
the major causes of business failure.

TRUISM
2 Your business is likely to operate at a loss for the first year of
operation.

There
are many excellent references that provide details about resources required
and where and how to borrow what you need. The following list will give
you a few preliminary guidelines to keep in mind:

Prepare
a listing of start-up costs and first year expenses. Assume NO sales
will be made and that you will be operating at a loss. You should
have this much capital available the day you open your door for business.
These expenses include, but are not limited to, items such as equipment,
office supplies, deposits for utilities, legal fees, licenses, advertising,
operating cash, wages, repairs, shipping, rent, utilities, insurance,
and taxes. Many of these expenses can be reduced or eliminated if
your business is conducted from your own residence.

If
your personal financial resources are not adequate, line up other
sources before the cash is required. Don't forget to obtain formal
commitments.

TRUISM 3
A personal guarantee will probably be required if you
borrow money from a bank.

Think
very carefully about personal guarantees before you decide it is worth
the risk. Chapter 11 has more details on this important topic.

Remember
that most investors are more likely to invest in an entrepreneur that
puts up some personal cash than one who is looking for 100% financing.

8. Are you
in good health?

You're
likely to be working hard, long hours and you need to be in good shape.
This is not a trivial matter ... You need to look after yourself. If
you are not already into an exercise program ... Start! If you smoke
... Quit! If you are a heavy drinker ... ease off. Take a stress management
course to be prepared when it hits ... and it will.

9. Do
you have a unique service or product?

Almost
too obvious to even mention but amazingly enough, forgotten by many.
Your product or service need not be "new" in the sense of "never before
available." But it must be unique in the sense of providing better service,
better support, or a new approach.

Dave,
a good friend and fellow amateur radio operator, started a radio equipment
and accessory retail store. Certainly not new, since there are hundreds
of such stores throughout the country and, in fact, there were three
within 50 miles of Dave's location. However, in less than a year,
he was outselling the other two stores and had acquired a good share
of their former customers. Why? Dave knew he needed to provide something
unique that would make his store more useful than his competitors.
Knowing that communications were "going digital" and there was a high
interest in combining computers and radio equipment, Dave provided
custom software to marry the customer's computer with the radio equip-ment
he sold. He's still going strong.

TRUISM
4 In order to be successful, your business must provide a service or
product that people want to buy.

10. Is
your family on board with your ideas? Will you have the support of your
significant other? Trouble at home is the last thing you need when starting
a business. The statistics in this area are grim ... a lot of breakups
occur during and immediately after a new business start-up. Don't let
this happen to you ... talk it out first. Make sure you share common
goals and objectives.

11. Are
you willing to make short term sacrifices in return for long term success?

This
may be obvious but think it through just the same. You may be spending
less time with family and friends, taking fewer (if any) vacations,
probably not wearing the latest fashions or driving a new car. All of
these things, we hope, are temporary but a lot of people are simply
not willing to give them up. If you can't, reconsider your priorities
before making a decision that may not be right for you.

12. Are
you a risk taker?

You need
to be! Starting a business can be a big risk and you need to be able
to make risky decisions and cope with the consequences. Taking risks
is commonplace with the entrepreneur ... opportunity comes with risk.

A few
years back, I gave up a government job, and moved to Venezuela to start
a business with partners from that country. I didn't speak the language
nor was I familiar with the legal system. I was in a strange country,
not understanding the language, and was de-pendent upon my partners
to get business. The venture turned out to be successful after some
quick learning experiences, but it certainly was a risk. I still remember
my friends saying to me, "You're giving up your government job for what??"
Risk? Yes! But what an experience!

My example
above is an extreme one, but you get the idea. If you think what I did
is completely crazy, you may not be a risk taker yourself. (Of course,
personal situations play a big part in these kinds of decisions but
it's the mental attitude we're interested in here.)

There
is risk of some sort in just about every decision you make but your
business decisions (Should I hire another worker? Should I purchase
that machine? Should I sign the contract?) carry major financial consequences
and in some cases can spell life or death for your company. Someone
who is somewhat comfortable with taking risk is more likely to make
the decision that will result in the bigger payoffs. Those kinds of
decisions can spell growth for your company.

13. Are
you a good communicator?

Strong
writing and speaking skills are essential to selling your product or
service and yourself. Be honest here; if you need improvement, take
a writing or public speaking course at your local university and visit
your library for books on the subject. Consider joining Toastmasters,
for ex-ample, or take a Dale Carnegie course. Consider enrolling in
a correspondence course.

14. Do
you have the necessary experience?

You should
start your business in an area where you have both an interest and experience.
Don't get involved in something you know little about ... it's a strike
against you that you do not need. Mind you, you don't have to be an
expert in everything - in fact, you can't be. For example, you can always
hire professional help in the area of marketing, finance, and taxes.
If you lack some of the technical expertise required, you might consider
a partnership with someone who will complement your expertise. Make
sure this person shares your goals and objectives. Chapter 5 includes
infor-mation about selecting a partner.

Some
so-called "experts" have written that a real entrepreneur should not
care what business he or she is in since "business is business." Not
so! As an entrepreneur, you want the best odds for success. You should
get involved only with some-thing you are both good at and interested
in.

Now that
you have a better idea of the meaning of each of the "entrepreneurial
elements," go back and review the marks you gave yourself in the test
and adjust them if necessary. If you still feel you need to improve
in any area, consider some of the suggestions in the chart on the following
page, which suggests ways in which you can improve.

SUMMARY

It is
important that you understand the qualities that most successful entrepreneurs
have and take steps to strengthen those in which you are weak. An honest
assessment of yourself is essential. When you're satisfied and know
you are ready, get your business started NOW ... or someone else will!

TRUISM 5
A really good idea will not last for long
before someone else runs with it.